LAYER -31.63% in 24 Hours Amid Sharp Short-Term Declines

On SEP 2 2025, LAYER dropped by 31.63% within 24 hours to reach $0.513, marking a continuation of a prolonged downturn that has seen the asset fall by 1025.09% within 7 days, and 305.65% within one month. Despite the sharp declines, LAYER has demonstrated a significant long-term upward trajectory, having risen by 15,215% over the past year.

The recent volatility reflects mounting pressure on the asset amid broader market uncertainty. Analysts project that the decline could be attributed to a combination of profit-taking and shifting risk appetites, with short-term traders exacerbating downward momentum. LAYER’s drop over the last 7 days has been particularly severe, indicating a possible re-evaluation of its fundamentals by market participants.

The sharp correction has raised questions about the sustainability of LAYER’s long-term gains, despite the impressive annual growth. Technical indicators suggest the asset is currently oversold, though with momentum indicators pointing downward. This divergence may reflect a market in transition, where bullish sentiment is being tested by increased bearish activity. The recent price action suggests a potential short-term bottoming process, though a reversal is not yet confirmed.

The market is closely watching whether LAYER will stabilize around key support levels or continue to retest lower thresholds. Analysts project that without a significant reversal in sentiment or a structural shift in underlying demand, LAYER could face further near-term pressure. However, the asset’s long-term trend remains intact, supported by its robust annual performance and underlying adoption metrics.

Backtest Hypothesis

A proposed backtesting strategy aims to evaluate the effectiveness of technical indicators in capturing LAYER’s recent volatility. The strategy uses a combination of moving averages and RSI levels to signal potential entry and exit points. Specifically, it looks for RSI readings below 30 to indicate oversold conditions, paired with a golden cross in the 50 and 200-day moving averages as a bullish confirmation. The strategy also incorporates stop-loss triggers below key support levels to manage downside risk.

The hypothesis is that the strategy can identify high-probability entry points during the asset’s downward correction, while limiting losses during further drawdowns. By focusing on confirmed breakouts and oversold conditions, the model aims to capture a portion of LAYER’s expected rebound. This approach aligns with the current technical environment, where divergences between price and indicators suggest an imminent shift in momentum could be on the horizon.